Spear's quotes Sarah Jane Boon on issues around VAT on private school fees

Labour’s pledge to levy VAT on private school fees could pose particular problems for divorced or separated parents.

When and how school fees are to be paid are often carefully negotiated as part of a financial agreement. If Labour wins the general election on 4 July, fees could rise by 20 per cent, leading to a significant increase in the costs originally agreed.

Sarah Jane Boon, Partner, tells Spear's:

Clients who are subject to school fees orders are worried about how quickly they will be able to get out those, if school fees become unaffordable as a result of VAT being added. On the other side, those clients who have an ex-partner or spouse paying school fees are concerned about the paying party saying the school fees are no longer affordable and a scenario then arising where it is difficult to find a good state school alternative that is the right fit for the child (and which both parents agree on).

They are often particularly anxious if the child may have to move in the middle of a school year and, more so, if that is an important year in terms of exams. Where clients are currently settling matters, and orders are being drawn up, the party who will be paying school fees is often keen for the order to say that their obligation is limited to the pre-VAT position, or to be reconsidered if VAT is added to school fees. The other party is often unwilling to agree to such wording, as they want to try to have certainty about the child’s schooling.

Read the full piece in Spear's here.